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8-K - 8-K - LogMeIn, Inc. | b84977e8vk.htm |
Exhibit 99.1
LogMeIn Announces Fourth Quarter and Fiscal Year 2010 Results
Annual Revenue up 36% to $101.1 Million; Fourth Quarter Revenue Increases 53% to $30.9
Million; Fourth Quarter Non-GAAP Net Income Doubles to $6.9 Million, or $0.28 per share;
Fourth Quarter Net Income Increases 118% to $5.4 Million, or $0.21 per share
Million; Fourth Quarter Non-GAAP Net Income Doubles to $6.9 Million, or $0.28 per share;
Fourth Quarter Net Income Increases 118% to $5.4 Million, or $0.21 per share
Woburn, Mass., February 15, 2011 LogMeIn, Inc. (NASDAQ: LOGM), a provider of SaaS-based,
remote-connectivity solutions, today announced its results for the fourth quarter and fiscal year
ended December 31, 2010.
For the fourth quarter of 2010, revenue increased 53 percent to $30.9 million from $20.2 million
reported in the fourth quarter of 2009. Net income attributable to common stockholders for the fourth quarter of 2010 increased to $5.4
million, or $0.21 per diluted share, from net income attributable to common stockholders of $2.5
million, or $0.10 per diluted share, reported in the fourth quarter of 2009. Revenue in the fourth quarter of 2010 includes $3.4
million in non-recurring revenue related to an agreement with Intel.
Non-GAAP net income
for the fourth quarter of 2010 increased to $6.9 million, or
$0.28 per diluted share, as compared to
$3.5 million, or $0.14 per diluted share, reported in the fourth quarter of 2009. Non-GAAP net
income excludes $106,000 in amortization of intangibles and $1.5 million in stock compensation
expense for the fourth quarter of 2010, and $186,000 in amortization of intangibles and $806,000 of
stock compensation expense for the fourth quarter of 2009.
For fiscal year 2010, revenue increased 36 percent to $101.1 million from $74.4 million in 2009.
Net income attributable to common stockholders increased to $21.1 million, or $0.85 per diluted
share, in fiscal year 2010 from net income attributable to common stockholders of $7.5 million, or
$0.37 per diluted share, reported in 2009.
Non-GAAP net income for fiscal year 2010 increased to $21.1 million, or $0.85 per diluted share,
from non-GAAP net income of $12.5 million, or $0.59 per diluted share, reported in 2009. Non-GAAP
net income excludes $589,000 in amortization of intangibles and $5.0 million in stock compensation
expense for 2010, and $743,000 in amortization of intangibles and $2.9 million of stock
compensation expense in 2009.
Cash flow from operations for the fourth quarter of 2010 was
$14.3 million, or 46 percent of
revenue, as compared to $7.0 million in the prior quarter. For fiscal year 2010, cash flow from
operations was $36.5 million, or 36 percent of revenue. The Company closed 2010 with cash, cash
equivalents and short-term investments of $167.4 million. A reconciliation of the
comparable GAAP financial measures to non-GAAP measures used above is included in the attached
tables.
Additionally, the Company reported total deferred revenue of $42.8 million, an increase of $2.3
million over the prior quarter. Total premium customers were approximately 585,000, up 285,000
during the fiscal year and an increase of approximately 95,000 customers in the fourth quarter, up
from an increase of approximately 85,000 in the prior quarter.
We are pleased to report a very strong fourth quarter and a great 2010 for LogMeIn, said Michael
Simon, President and CEO of LogMeIn. Over the past year LogMeIn has aggressively strived to be at
the forefront of changes in mobility, innovating on our products and business to meet the rapidly
evolving needs of todays consumers and organizations. This ability to embrace and capitalize on
these market trends through consistent, across-the-business execution was a hallmark of LogMeIns
success in 2010 success that we believe manifested itself in our financial results, significant
customer growth and expansion into new market opportunities.
Evidence of this trend came in the form of new offerings and expansions to our core product lines.
These development efforts included the launch of iPad and Android versions of our popular Ignition
app, our entry into the collaboration market with join.me, new features in Rescue to support an
increasing number of iPads entering the workplace, and the addition of One2Many capabilities to
LogMeIn Central to better support distributed, mobile workforces.
As we look into 2011, we believe that changes in the mobile and digital landscape the
proliferation of tablets, the rise of the multi-device consumer, and an increasing number of
businesses embracing bring your own device policies will only continue to accelerate. We
believe our remote access, support and collaboration businesses are uniquely positioned to benefit
from these market trends this year and beyond. We remain committed to the ongoing innovation and
across-the-business execution necessary to help us to further capitalize on this digital and mobile
evolution. As a result, we continue to be optimistic about our ultimate opportunity to grow the
business, expand our market presence and deliver more stockholder value over the long-term,
concluded Simon.
Business Outlook
Based on information available as of February 15, 2011, LogMeIn is issuing guidance for the first
quarter 2011 and fiscal year 2011.
This guidance includes litigation costs associated with the Companys defense against the patent
infringement claims made by 01 Communique. The Company continues to defend itself vigorously
against these claims and believes it has strong defenses against the claims. The litigation costs
associated with defending the claims are increasing as the Company progresses further in the
discovery process and enters the trial phase. Accordingly, the Company expects its litigation
related costs to be approximately $3.0 million in each of the first and second quarters of 2011 and
approximately $8.0 million for the full fiscal year. Due to the nature and
extent of these litigation costs the Company will issue separate guidance on the litigation costs
and report these costs as a reconciling item in its non-GAAP disclosure for 2011.
First Quarter 2011: The Company expects first quarter revenue to be in the range of $26.3
million to $26.6 million.
Non-GAAP net income is expected to be in the range of $3.3 million to $3.6 million, or $0.13 to
$0.14 per diluted share. Non-GAAP net income will exclude an estimated $112,000 in amortization of
intangibles, $1.9 million in stock compensation expense, and $3.0 million in litigation expenses
related to patent infringement defense.
Net income, which includes the amortization of intangibles, stock compensation and litigation
expenses, is expected to be in the range of $100,000 to $400,000, or $0.00 to $0.01 per share.
Net income per diluted share calculations for the first quarter of 2011 are based on estimated
fully-diluted weighted average shares outstanding of 25.5 million shares.
Fiscal year 2011: The Company expects full year 2011 revenue to be in the range of $116.0
million to $120.0 million.
Non-GAAP net income is expected to be in the range of $17.7 million to $19.0 million, or $0.68 to
$0.73 per diluted share. Non-GAAP net income will exclude an estimated $300,000 in amortization of
intangibles, $9.0 million in stock compensation expense, and $8.0 million in litigation expenses
related to patent infringement defense.
Net income, which includes the amortization of intangibles, stock compensation and litigation
expenses, is expected to be in the range of $6.5 million to $7.8 million, or $0.25 to $0.30 per
share.
GAAP and non-GAAP net income for the first quarter and fiscal year 2011 assume an effective tax
rate of 35 percent, versus, a GAAP tax benefit rate of 13 percent in fiscal year 2010, due to the
reversal of its tax valuation allowance and a Non-GAAP effective tax rate of 13 percent.
Net income per diluted share calculations for 2011 are based on estimated fully-diluted weighted
average shares outstanding of 26.1 million shares.
Conference Call Information for Today, Tuesday, February 15, 2011
LogMeIn will host a corresponding conference call and live webcast at 5:00 p.m. Eastern Time today.
To access the conference call, dial 877-941-2069 (for the U.S. and Canada) or 480-629-9713 (for
international callers). A live webcast will be available on the Investor Relations section of the
Companys corporate website at www.LogMeIn.com and via replay beginning approximately two hours
after the completion of the call until the Companys announcement of its financial results for the
next quarter. An audio replay of the call will also be available to
investors beginning at approximately 7:00 p.m. Eastern Time on February 15, 2011 until 11:59 p.m.
Eastern Time on February 22, 2011, by dialing 800-406-7325 (for the U.S. and Canada) or
303-590-3030 (for international callers) and entering passcode 4401281#.
Non-GAAP Financial Measures
This press release contains non-GAAP financial measures including non-GAAP operating income,
non-GAAP net income, non-GAAP net income per diluted share and non-GAAP cash flow from operations.
Non-GAAP operating income excludes the amortization of intangibles and stock compensation expense.
Non-GAAP net income and non-GAAP net income per diluted share exclude the amortization of
intangibles, stock compensation expense and expenses related to the accretion of redeemable
convertible preferred stock. Non-GAAP net income further excludes a one-time tax benefit associated
with the reversal of a valuation allowance. Non-GAAP cash flow from operations includes a non-cash
tax benefit associated with the exercise of employee stock options. The Company believes that
these non-GAAP measures of financial results provide useful information to management and investors
regarding certain financial and business trends relating to the Companys financial condition and
results of operations. The Companys management uses these non-GAAP measures to compare the
Companys performance to that of prior periods and uses these measures in financial reports
prepared for management and the Companys board of directors. The Company believes that the use of
these non-GAAP financial measures provides an additional tool for investors to use in evaluating
ongoing operating results and trends and in comparing the Companys financial measures with other
software-as-a-service companies, many of which present similar non-GAAP financial measures to
investors.
The Company does not consider these non-GAAP measures in isolation or as an alternative to
financial measures determined in accordance with GAAP. The principal limitation of these non-GAAP
financial measures is that they exclude significant elements that are required by GAAP to be
recorded in the Companys financial statements. In addition, they are subject to inherent
limitations as they reflect the exercise of judgments by management in determining these non-GAAP
financial measures. In order to compensate for these limitations, management of the Company
presents its non-GAAP financial measures in connection with its GAAP results. The Company urges
investors to review the reconciliation of its non-GAAP financial measures to the comparable GAAP
financial measures, which it includes in press releases announcing quarterly financial results,
including this press release, and not to rely on any single financial measure to evaluate the
Companys business.
Reconciliation tables of the most comparable GAAP financial measures to the non-GAAP measures used
in this press release are included in this release.
About LogMeIn, Inc.
LogMeIn (Nasdaq:LOGM) provides SaaS-based remote access, support and collaboration solutions to
quickly, simply and securely connect millions of internet-enabled devices across the globe
computers, smartphones, iPad tablets, digital displays, and even in-dash computers of the Ford
F-150 pick-up truck. Designed for consumers, mobile professionals and IT
organizations, LogMeIns solutions empower over 11.0 million active users to connect more than 100
million devices. LogMeIn is based in Woburn, Massachusetts, USA, with offices in Australia,
Hungary, the Netherlands, and the UK.
Cautionary Language Concerning Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995, including but not limited to,
statements regarding the value and effectiveness of the Companys products, the introduction or
performance of product enhancements or new products, the Companys intent to expand its portfolio
of products, the Companys growth, the Companys litigation with 01 Communique, including costs
associated with the litigation, and expansion and the Companys financial guidance for fiscal year
2011 and the first quarter of 2011. These forward-looking statements are made as of the date they
were first issued and were based on current expectations, estimates, forecasts and projections as
well as the beliefs and assumptions of management. Words such as expect, anticipate, should,
believe, hope, target, project, goals, estimate, potential, predict, may, will,
might, could, intend, variations of these terms or the negative of these terms and similar
expressions are intended to identify these forward-looking statements. Forward-looking statements
are subject to a number of risks and uncertainties, many of which involve factors or circumstances
that are beyond the Companys control. The Companys actual results could differ materially from
those stated or implied in forward-looking statements due to a number of factors, including but not
limited to, dependence on the remote support and software market, customer adoption of the
Companys solutions, the Companys ability to attract new customers and retain existing customers,
adverse economic conditions in general and adverse economic conditions specifically affecting the
markets in which the Company operates, intellectual property litigation, the Companys ability to
continue to promote and maintain its brand in a cost-effective manner, the Companys ability to
compete effectively, the Companys ability to develop and introduce new products and add-ons or
enhancements to existing products, the Companys ability to manage growth, the Companys ability to
attract and retain key personnel, the Companys ability to protect its intellectual property and
other proprietary rights, the result of any pending litigation, and other risks detailed in the
Companys other publicly available filings with the Securities and Exchange Commission. Past
performance is not necessarily indicative of future results. The forward-looking statements
included in this press release represent the Companys views as of the date of this press release.
The Company anticipates that subsequent events and developments will cause its views to change.
The Company undertakes no intention or obligation to update or revise any forward-looking
statements, whether as a result of new information, future events or otherwise. These
forward-looking statements should not be relied upon as representing the Companys views as of any
date subsequent to the date of this press release.
LogMeIn, LogMeIn Central, LogMeIn Pro2, LogMeIn Hamachi2, LogMeIn Free, LogMeIn Rescue,
LogMeIn Ignition and join.me are trademarks or registered trademarks of LogMeIn in the US and other
countries around the world. iPhone and iPad are trademarks of Apple, Inc. in the US
LogMeIn Ignition and join.me are trademarks or registered trademarks of LogMeIn in the US and other
countries around the world. iPhone and iPad are trademarks of Apple, Inc. in the US
and other countries around the world. Intel is the trademark of Intel Corporation in the US and
other countries around the world.
other countries around the world.
Contact Information:
Investors
Erica Abrams or Matthew Hunt
Blueshirt Group
415-217-5864, 415-489-2194
erica@blueshirtgroup.com
matt@blueshirtgroup.com
Erica Abrams or Matthew Hunt
Blueshirt Group
415-217-5864, 415-489-2194
erica@blueshirtgroup.com
matt@blueshirtgroup.com
Press
Craig VerColen
LogMeIn, Inc.
781-897-0696
Press@LogMeIn.com
Craig VerColen
LogMeIn, Inc.
781-897-0696
Press@LogMeIn.com
LogMeIn, Inc.
Condensed Consolidated Balance Sheets (unaudited)
(In thousands)
Condensed Consolidated Balance Sheets (unaudited)
(In thousands)
December 31, | December 31, | |||||||
2009 | 2010 | |||||||
ASSETS |
||||||||
Current assets: |
||||||||
Cash and cash equivalents |
$ | 100,290 | $ | 77,280 | ||||
Marketable securities |
29,956 | 90,144 | ||||||
Accounts receivable, net |
4,150 | 4,744 | ||||||
Prepaid expenses and other current assets |
1,834 | 2,906 | ||||||
Deferred income taxes |
| 1,316 | ||||||
Total current assets |
136,230 | 176,390 | ||||||
Property and equipment, net |
4,859 | 6,199 | ||||||
Restricted cash |
373 | 350 | ||||||
Intangibles, net |
751 | 578 | ||||||
Goodwill |
615 | 615 | ||||||
Other assets |
31 | 27 | ||||||
Deferred income taxes |
| 2,518 | ||||||
Total assets |
$ | 142,859 | $ | 186,677 | ||||
LIABILITIES AND STOCKHOLDERS EQUITY | ||||||||
Current liabilities: |
||||||||
Accounts payable |
$ | 2,328 | $ | 2,177 | ||||
Accrued liabilities |
7,324 | 10,829 | ||||||
Deferred revenue, current portion |
32,191 | 41,763 | ||||||
Total current liabilities |
41,843 | 54,769 | ||||||
Deferred revenue, net of current portion |
1,912 | 1,030 | ||||||
Other long-term liabilities |
595 | 500 | ||||||
Total liabilities |
44,350 | 56,299 | ||||||
Commitments and contingencies |
||||||||
Stockholders equity: |
||||||||
Common stock |
224 | 238 | ||||||
Additional paid-in capital |
122,465 | 133,425 | ||||||
Accumulated deficit |
(24,183 | ) | (3,084 | ) | ||||
Accumulated other comprehensive income (loss) |
3 | (201 | ) | |||||
Total stockholders equity |
98,509 | 130,378 | ||||||
Total liabilities and stockholders equity |
$ | 142,859 | $ | 186,677 | ||||
LogMeIn, Inc.
Condensed Consolidated Statements of Income (unaudited)
(In thousands, except share and per share data)
Condensed Consolidated Statements of Income (unaudited)
(In thousands, except share and per share data)
Three Months Ended December 31, | Twelve Months Ended December 31, | |||||||||||||||
2009 | 2010 | 2009 | 2010 | |||||||||||||
Revenue |
$ | 20,233 | $ | 30,890 | $ | 74,408 | $ | 101,057 | ||||||||
Cost of revenue |
2,000 | 2,396 | 7,508 | 9,124 | ||||||||||||
Gross profit |
18,233 | 28,494 | 66,900 | 91,933 | ||||||||||||
Operating expenses |
||||||||||||||||
Research and
development |
3,662 | 4,340 | 13,149 | 15,214 | ||||||||||||
Sales and marketing |
9,443 | 13,715 | 35,821 | 45,869 | ||||||||||||
General and
administrative |
2,510 | 3,929 | 8,297 | 12,319 | ||||||||||||
Amortization of
intangibles |
82 | 92 | 328 | 338 | ||||||||||||
Total operating
expenses |
15,697 | 22,076 | 57,595 | 73,740 | ||||||||||||
Income from operations |
2,536 | 6,418 | 9,305 | 18,193 | ||||||||||||
Interest income, net |
61 | 178 | 128 | 634 | ||||||||||||
Other income (expense) |
7 | (117 | ) | (294 | ) | (219 | ) | |||||||||
Income before income
taxes |
2,604 | 6,479 | 9,139 | 18,608 | ||||||||||||
Benefit (provision) for
income taxes |
(130 | ) | (1,092 | ) | (342 | ) | 2,491 | |||||||||
Net income |
2,474 | 5,387 | 8,797 | 21,099 | ||||||||||||
Accretion of redeemable
convertible
preferred stock |
| | (1,311 | ) | | |||||||||||
Net income attributable
to common
stockholders |
$ | 2,474 | $ | 5,387 | $ | 7,486 | $ | 21,099 | ||||||||
Net income attributable
to common
stockholders per share: |
||||||||||||||||
basic |
$ | 0.11 | $ | 0.23 | $ | 0.39 | $ | 0.91 | ||||||||
diluted |
$ | 0.10 | $ | 0.21 | $ | 0.37 | $ | 0.85 | ||||||||
Weighted average shares
outstanding: |
||||||||||||||||
basic |
22,284,261 | 23,753,375 | 12,989,943 | 23,244,479 | ||||||||||||
diluted |
24,213,837 | 25,222,794 | 14,835,314 | 24,839,905 |
Calculation of Non-GAAP Operating Income, Non-GAAP Net Income and Non-GAAP Net Income per share (unaudited)
(In thousands, except share and per share data)
(In thousands, except share and per share data)
Three Months Ended December 31, | Twelve Months Ended December 31, | |||||||||||||||
2009 | 2010 | 2009 | 2010 | |||||||||||||
GAAP Income from operations |
$ | 2,536 | $ | 6,418 | $ | 9,305 | $ | 18,193 | ||||||||
Add Back: |
||||||||||||||||
Amortization of intangibles included in cost of revenue |
104 | 14 | 415 | 251 | ||||||||||||
Amortization of intangibles included in operating expense |
82 | 92 | 328 | 338 | ||||||||||||
Stock-based compensation expense |
806 | 1,456 | 2,922 | 4,992 | ||||||||||||
Non-GAAP Operating income |
3,528 | 7,980 | 12,970 | 23,774 | ||||||||||||
Other income (expense), net |
68 | 61 | (166 | ) | 415 | |||||||||||
Non-GAAP Income before provision for income taxes |
3,596 | 8,041 | 12,804 | 24,189 | ||||||||||||
Provision for income taxes (For the twelve months ended
December 31, 2010, excludes a $5,572 tax benefit for the
reversal
of a valuation allowance related to U.S. and certain
foreign deferred tax assets) |
(130 | ) | (1,092 | ) | (342 | ) | (3,081 | ) | ||||||||
Non-GAAP Net income |
$ | 3,466 | $ | 6,949 | $ | 12,462 | $ | 21,108 | ||||||||
Non-GAAP Diluted net income per share: |
$ | 0.14 | $ | 0.28 | $ | 0.59 | $ | 0.85 | ||||||||
Diluted weighted average shares outstanding used in
computing per share amounts: |
24,213,837 | 25,222,794 | 21,167,966 | 24,839,905 |
Stock-Based Compensation Expense
(In thousands)
(In thousands)
Three Months Ended December 31, | Twelve Months Ended December 31, | |||||||||||||||
2009 | 2010 | 2009 | 2010 | |||||||||||||
Stock-based compensation expense: |
||||||||||||||||
Cost of revenue |
$ | 16 | $ | 64 | $ | 54 | $ | 261 | ||||||||
Research and development |
110 | 192 | 537 | 638 | ||||||||||||
Sales and marketing |
253 | 510 | 932 | 1,553 | ||||||||||||
General and administrative |
427 | 690 | 1,399 | 2,540 | ||||||||||||
Total stock based-compensation |
$ | 806 | $ | 1,456 | $ | 2,922 | $ | 4,992 | ||||||||
LogMeIn, Inc.
Condensed Consolidated Statements of Cash Flows (unaudited)
(In thousands)
Condensed Consolidated Statements of Cash Flows (unaudited)
(In thousands)
Three Months Ended December 31, | Twelve Months Ended December 31, | |||||||||||||||
2009 | 2010 | 2009 | 2010 | |||||||||||||
Cash flows from operating activities |
||||||||||||||||
Net income |
$ | 2,474 | $ | 5,387 | $ | 8,797 | $ | 21,099 | ||||||||
Adjustments to reconcile net income to net cash
provided by operating activities: |
||||||||||||||||
Depreciation and amortization |
922 | 983 | 3,201 | 3,719 | ||||||||||||
Amortization of premiums on investments |
1 | 79 | 1 | 239 | ||||||||||||
Provision for bad debts |
30 | 23 | 115 | 88 | ||||||||||||
Deferred income taxes |
2 | 2,831 | 14 | (3,823 | ) | |||||||||||
Stock-based compensation |
806 | 1,456 | 2,922 | 4,992 | ||||||||||||
Loss (gain) on disposal of equipment |
| | 1 | (2 | ) | |||||||||||
Changes in assets and liabilities: |
||||||||||||||||
Accounts receivable |
251 | 1,060 | 436 | (682 | ) | |||||||||||
Prepaid expenses and other current assets |
290 | (745 | ) | (169 | ) | (1,071 | ) | |||||||||
Other assets |
2 | (3 | ) | (8 | ) | 3 | ||||||||||
Accounts payable |
251 | (1,182 | ) | 730 | (332 | ) | ||||||||||
Accrued liabilities |
630 | 2,030 | 2,104 | 3,644 | ||||||||||||
Deferred revenue |
2,139 | 2,331 | 5,744 | 8,690 | ||||||||||||
Other long-term liabilities |
103 | 29 | 451 | (95 | ) | |||||||||||
Net cash provided by operating activities |
7,901 | 14,279 | 24,339 | 36,469 | ||||||||||||
Cash flows from investing activities |
||||||||||||||||
Purchases of marketable securities |
(30,011 | ) | (29,961 | ) | (30,011 | ) | (185,349 | ) | ||||||||
Proceeds from sale or disposal of marketable securities |
| 20,000 | | 125,000 | ||||||||||||
Purchases of property and equipment |
(445 | ) | (1,809 | ) | (3,373 | ) | (4,243 | ) | ||||||||
Intangible asset additions |
| (39 | ) | | (416 | ) | ||||||||||
Decrease in restricted cash and deposits |
226 | | 219 | 5 | ||||||||||||
Net cash used in investing activities |
(30,230 | ) | (11,809 | ) | (33,165 | ) | (65,003 | ) | ||||||||
Cash flows from financing activities |
||||||||||||||||
Proceeds from issuance of common stock in connection with initial public offering,
net of issuance costs of $1,397 |
(125 | ) | | 84,162 | | |||||||||||
Proceeds from issuance of common stock in connection with secondary public
offering, net of issuance costs of $266 |
1,478 | | 1,478 | | ||||||||||||
Payments of issuance costs related to secondary offering
of common stock |
| | | (196 | ) | |||||||||||
Stock option related activity |
351 | (691 | ) | 517 | 5,985 | |||||||||||
Net cash provided by (used in) financing activities |
1,704 | (691 | ) | 86,157 | 5,789 | |||||||||||
Effect of exchange rate changes on cash and
cash equivalents and restricted cash |
(92 | ) | (139 | ) | 46 | (265 | ) | |||||||||
Net increase (decrease) in cash and cash equivalents |
(20,717 | ) | 1,640 | 77,377 | (23,010 | ) | ||||||||||
Cash and cash equivalents, beginning of period |
121,007 | 75,640 | 22,913 | 100,290 | ||||||||||||
Cash and cash equivalents, end of period |
$ | 100,290 | $ | 77,280 | $ | 100,290 | $ | 77,280 | ||||||||